Health Care Reform Update -- October 1, 2012

Implementation of the Affordable Care Act; Other HHS and Federal Regulatory Initiatives; Other Health Care News; and Hearings and Mark-Ups Scheduled.

Excerpt from Implementation of the Affordable Care Act -

On September 24th the Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that insured persons are now able to receive a summary of benefits and coverage from insurance providers, a new requirement under the ACA. Secretary Sebelius said the plan will help Americans choose insurance plans and make care options more understandable.

Tom Koutsoumpas, TKoutsoumpas@mlstrategies.com Jeremy Rabinovitz, JRabinovitz@mlstrategies.com Alexander Hecht, AHecht@mlstrategies.com Gary Bacher, GEBacher@mintz.com Joseph P. Hammang, PhD, JPHammang@mlstrategies.com Kevin M. Kappel, KMKappel@mlstrategies.com Robert C. Skinner, RCSkinner@mlstrategies.com Joshua Booth, JBooth@mintz.com ML Strategies, LLC 701 Pennsylvania Avenue, N.W. Washington, D.C. 20004 USA 202 434 7300 202 434 7400 fax www.mlstrategies.com www.mlstrategies.com HEALTH CARE REFORM UPDATE October 1, 2012 Implementation of the Affordable Care Act On September 24th the Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that insured persons are now able to receive a summary of benefits and coverage from insurance providers, a new requirement under the ACA. Secretary Sebelius said the plan will help Americans choose insurance plans and make care options more understandable. A full release from HHS can be found here. On September 25th HHS announced that the ACA will boost the number of social workers and psychologists available to work with Americans in rural areas, military personnel, veterans, and their families. The Mental and Behavioral Health Education and Training grant program will provide $9.8 million to 24 graduate school programs to recruit students and offer support for clinical training in mental and behavioral health. The release from HHS is available here. On September 26th Pennsylvania Insurance Commissioner Michael Consedine sent a letter to HHS Secretary Sebelius requesting more detailed information on exchanges and essential health benefits. Consedine said the lack of clarity should be resolved soon to allow for ample time to allow the market to adjust to regulatory changes. The letter from Consdedine can be read here. On September 27th HHS Secretary Sebelius announced the ACA will provide funds to help 810 community health centers become patient-centered medical homes (PCMH). The PCMH model is designed to improve care quality by creating better coordination and treating multiple patient issues at once. The press release from HHS is available here. On September 27th the Republican Governors Association (RGA) sent a letter to President Obama with 30 questions regarding the ACA. The RGA originally sent these questions in July and says many have gone unanswered, including questions requesting clarification on the creation of state-based insurance exchanges. The letter from the RGA can be read here. October 1, 2012 Page 2 www.mlstrategies.com On September 27th HHS announced five new states and the District of Columbia have been awarded resources through Affordable Insurance Exchange Establishment Grants to create new health insurance marketplaces for state residents. The insurance exchanges are intended to offer greater choice for health care consumers. The release from HHS is available here. On September 27th CMS announced seven organizations have been awarded cooperative agreements to partner with 145 nursing facilities across the country. The seven organizations will help the nursing facilities implement the Initiative to Reduce Avoidable Hospitalizations among Nursing Facility Residents. The program will be run collaboratively between the Center for Medicare & Medicaid Innovation (CMMI) and the Medicare-Medicaid Coordination Office, both created by the ACA. The press release from CMS with partnering organizations is available here. On October 1st hospice care centers across the country must begin measuring patient pain levels and report data to the Centers for Medicare and Medicaid Services (CMS). Hospices also must take part in a quality program that addresses three patient care-related aspects. Additional information on the guidelines can be found here. Other HHS and Federal Regulatory Initiatives On September 24th HHS Secretary Kathleen Sebelius and Attorney General Eric Holder wrote to five major hospital trade associations saying that they would not tolerate attempts to falsify electronic health records to receive payments for services not rendered. The Obama administration said it is very concerned about the situation, but noted that electronic health records have the potential to save money and save lives. The letter is available here. That same day, the American Hospital Association (AHA) responded to the letter stating that Medicare and Medicaid payment rules are becoming increasingly complex and that multiple requests have been made for CMS to streamline guidelines for reporting. The letter from the AHA can be read here. On September 24th Federal Communications Commission (FCC) Chairman Julius Genachowski announced the FCC would take action on recommendations made in a mHealth task force report. The FCC will pursue greater collaboration with the health care sector and will recruit a permanent Health Care Director to serve as the point of contact for external groups. The mHealth report can be read here. Remarks made by Chairman Genachowski are available here. On September 26th the HHS Office of the National Coordinator for Health IT (ONC) received a report which details plans to improve electronic health records (EHR) sharing between health information exchanges (HIE). The report stemmed from interest among states in the Gulf and Southeast regions to develop a plan for the sharing of health information data during and after a declared disaster and includes five recommendations for state HIEs. The report can be viewed here. On September 26th the HHS ONC said behavioral health providers may benefit greatly by increasing adoption of health information technology. A report released by the ONC indicates rates of health IT adoption lag among behavioral health clinicians in part due to limited resources. The full report is available here. October 1, 2012 Page 3 www.mlstrategies.com On September 27th Darrell Issa (R-CA), Chairman of the House Oversight Committee, and committee member James Lankford (R-OK) sent a letter to HHS Secretary Sebelius indicating that compulsory process would be considered if HHS did not release documentation on an $8.3 billion demonstration program to reward successful Medicare Advantage plans. Issa and Lankford expressed concerns that the program is too costly and does not effectively reward better-performing Medicare Advantage plans. The letter can be seen here. On September 28th CMS issued a document correcting technical errors in the August 31st Federal Register on prospective payment systems for acute and long-term care hospitals and quality reporting requirements for specific providers. The corrections, which go into effect October 1st, can be seen here. On September 28th the Food and Drug Administration (FDA) launched a new website to help consumers identify whether on online pharmacy is safe. The FDA launched the website to prevent the sale of counterfeit drugs from illegal online pharmacies. The website, BeSafeRx, can be viewed here. On September 28th the Office of Management and Budget (OMB) sent a memo to federal agencies advising that notices of potential layoffs as a result of sequestration should not yet be sent. The OMB said that sequestration may still be avoided and should largely be ignored for now. The full memo from the OMB can be seen here. Other Congressional and State Initiatives On September 22nd California Governor Jerry Brown (D) signed a bill allowing nurses in the state to prescribe birth control. The decision was praised by proponents who noted the bill will address provider shortages and decrease delays for women seeking contraception. An article on the governor’s approval can be read here. On September 24th Representative Michael Burgess (R-TX) and Delegate Donna Christensen (D-VI) introduced legislation that would change the Congressional Budget Office’s (CBO) scoring procedure for preventative health care. The bill would allow the CBO to collect data and project savings outside of the current ten year window. A release from the office of Rep. Burgess can be found here. The text of the bill can be read here. On September 27th a group of House Democrats including Reps. Anna Eshoo (D-CA), Ed Markey (D-MA), and Donna Edwards (D-MD), encouraged the FDA to take greater initiative in protecting the security of medical devices implanted in patients. An earlier Government Accountability Office (GAO) report requested by the three Democrats had also highlighted the security risks and encouraged the FDA to appropriately address them. The GAO report is available here. An article addressing the concerns of three Congressmen is available here. On September 28th Senator Chuck Grassley (R-IA), Ranking Member of the Senate Judiciary Committee, and Representative Fred Upton (R-MI), Chairman of the House Energy & Commerce Committee, insisted that the Obama Administration explain why $1 billion has gone to 33 states to establish American Health Benefit Exchanges. Grassley and Upton say that, even with sequestration looming, HHS has freely spent money and has failed to indicate the necessity of this spending. The letter from Grassley and Upton can be read here. October 1, 2012 Page 4 www.mlstrategies.com Other Health Care News On September 24th Avalere Health released a report indicating that seven of the top ten prescription drug plans (PDPs) will have double digit increases in premiums in 2013. Low-cost options will still be available, but Avalere suggests seniors may wish to switch plans to find a more cost-effective option. A full analysis from Avalere can be found here. On September 24th a poll released by Gallup found that more Americans trust President Obama to handle Medicare issues than Mitt Romney. Nationally, 51% of respondents said they trusted Obama to address Medicare, versus 43% who stated they trusted Romney to address the issue. An article on the poll results can be read here. The full poll results are available here. On September 25th the Health Care Cost Institute (HCCI) released a report indicating that costs for persons with employer-sponsored insurance (ESI) increased by 4.6% in 2011. An average of $4,547 was spent on health care costs for each person in the ESI population. Higher prices for hospital stays, outpatient care, procedures, and prescriptions contributed to the increase. Analysts are not yet sure if the latest report indicates an end to the downturn in health care cost growth. An article on the study can be read here. The full report is available here. On September 25th Mission: Readiness, a group of retired military generals, announced that obesity in the United States poses a threat to national security. The group recommends that the federal government update standards for what can be sold in school vending machines, a la carte lines, and snack bars. More information can be found here. On September 25th the National Research Council reported that the aging population in the United States will have broad economic implications on federal programs that support the elderly. The increasing number of Americans over age 65 is a trend that will undoubtedly continue in the years ahead. A release discussing the report is available here. A report brief is available here. On September 26th the Susan B. Anthony List released a poll which found that 69 percent of voters in swing states oppose a federal mandate requiring religious institutions to provide contraceptive coverage under employer-provided insurance plans. The poll results are available here. On September 26th a poll released by AP-GfK shows that the majority of Americans, regardless of their approval, believe the Affordable Care Act will remain largely intact after November’s election. Seventy percent believe the ACA will go into effect with only some changes, with just 12% of the electorate believing that the ACA will be repealed entirely. An article on the poll results can be viewed here. On September 27th the Employee Benefit Research Institute (EBRI) released a report noting that while the number of uninsured Americans has decreased, the number of persons covered through their employer has also decreased. An increasing number of Americans are covered through public programs such as Medicaid and the State Children’s Health Insurance Program. The report from EBRI can be read here. On September 27th the Institute of Medicine (IOM) released a report noting that certain tests currently used to measure the fitness of school children may not be effective. The IOM said Body Mass Index October 1, 2012 Page 5 www.mlstrategies.com and the progressive shuttle run are effective fitness measurements. The release from IOM is available here. A report brief can be read here. Hearings and Mark-Ups Scheduled Both the Senate and the House of Representatives are in recess.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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